Want vs. Needs: Car Edition

Cars. I love and hate them. I love how convenient they can be, I hate how much they cost. This weekend, I dropped $900 on car repairs, and to do so I had to access my emergency fund for the first time since I put $10,000 in it over a year ago. In fact, almost every time I’ve dipped into my emergency fund, it’s been for car repairs. I might as well rename it the car repair fund.

Spending money on these repairs has reminded me that my eight-year-old City Golf is not going to last forever, and expensive repairs like this are going to become more and more normal as we add kilometres to its odometer.

Looking at my car in a less-than-favourable light after doing repair work on it also gets me thinking about how the car has been failing to meet our needs since we moved into the city. There are two glaring drawbacks of our faithful little car:

It’s a manual. I can drive it, but I hate driving it on Halifax’s hills. As a result, I avoid driving as much as possible. I know this wouldn’t be the case with an automatic. Right now I’ve set up my life so I don’t have to drive much, but I’m not sure if that’s because I hate driving, or because I just hate driving my car. Either way, it would be nice to have a car that wasn’t in danger of rolling back into the car behind me at every stop sign. I have a lot of anxiety around driving anyway, and this just compounds things.

It is woefully inadequate for serious winter driving. Our car is a game little machine, but it finally met its match during this winter’s terrible snow storms. In fact, my husband was almost in a serious accident on the way to work once because of this.

Those are the only two issues, but they are big issues, and they are issues that would be resolved by a new-to-us-car.

So welcome to my latest (and very expensive) want! A different car.

In my ideal life, I’d buy a new-to-me car before winter hits. It would either be a Subaru Outback or a Volkswagen Tiguan, and it would be used with between 50,000 – 100,000 kilometres on it. It would cost about $15,000 and it would be an automatic, all-wheel drive vehicle. It would be ideal for handling our heavy snow storms, and easy enough for me to manoeuvre in the city.

In my alternate life (the life I’m actually living) I actually do have the means to make this happen. I have about $7,000 in the house fund, and our current car is worth about $5,000. After taxes and fees and such I’d end up with a car loan of around $5,000, which would work out to a monthly payment of less than $100 per month, which is totally doable in my budget right now.

There are several problems with this plan though:

That money is for a house, not a car. I would be undoing six months of saving.

My husband is desperately fond of our City Golf and wants to keep it forever. I would have a hard time convincing him to trade it in. He’d rather we go up to a two-car family instead.

I don’t need a new car, I just want it.

While I want a new-to-me car, it’s definitely not a need right now. Our current car has some issues, but it still works. We own it outright, and as long as we make responsible decisions about driving it in the winter, we should be ok with it for several more years.

I want a different car, but I can’t have it right now. Not while I’m trying to save for a house, and not while our current car is still in decent working condition. We could swing it, but it would be a hit financially. I’d feel safer driving, but $15,000 safer?

For now, we’ll stick with the City Golf and be cautious about driving it in poor winter conditions. I’ll keep the idea of a better car in the back of my mind, at least for a few more years.

When did you replace your first “adult” car? How old was it? Do you think I’m making the right choice? I want to know!

Stay Up To Date

I don’t have a car, and have managed with transit for the past 12 years, even when i was briefly living in Halifax!

I’m surprised that you don’t have a ‘car maintenance’ fund, car repairs aren’t typically an emergency as you can expect repairs to be needed over the period of ownership. It might be something you want to look into setting up.

I have money set aside (in YNAB!) for a number of categories for sometimes expenses, like a new cell phone or gadget, medical fees, Christmas, taxi/parking fees when I borrow a car, and I’m already saving for my imaginary future car.

I wish we could go car free! Unfortunately my husband needs it for work, and we travel to New Brunswick quite frequently to visit family. I do have a car maintenance fund, which typically has $450 ish in it. These repairs exceeded that, so I had to dip into my emergency fund.

When I moved to Vancouver, I didn’t have a car for 7 years. I was living and working close to public transit. I was also a member of a couple of car-cooperatives, where I could rent a car for a couple of hours when I needed one, very affordable.

Then, I bought a condo in the suburbs, where public transit is not as common and no car-coop either, so I bought a car. Luckily, I can afford it, but it costs me a lot of $! Money I don’t have for something else.

Perhaps you should review your car situation in a couple of year, when your car hits the 10-year mark.

I can completely relate to your desire for a new car. I’m driving a 2004 Honda Civic with two wheel drive and I’m terrified all winter long. I think for safety reasons my next car must have all wheel drive, but it is surprisingly tricky to find a car that is both small enough for city life and has all wheel drive. You might check out the Honda HRV, which is what I’m currently lusting after. Its new, so you can’t buy an older model, but seems like it might offer what you’re looking for.

I’m obsessed with my car. Like genuinely head-over-feet in love with it. My fiance & I bought it together after nearly a year of setting money aside for it (knowing we’d have to replace the 1989 Mercedes Benz we were driving) and used his quarterly bonuses + my trading profits. We settled on a 2011 black Audi A4 S-line. I am still not entirely sure what the “S-line” part means except that it cost an additional $5K but whatever.

I would discourage you from buying a car that’s more than double your retirement savings. Especially if you’d also have to give up your house fund. It seems crazy to make those kinds of sacrifices just for a vehicle, which at the end of the day is merely a money suck (I splurged on my car, but I acknowledge that it only takes $5,000 to buy a car that drives you from point A to point B, so anything after that is pure spending-for-the-sake-of-spending)

Your house fund is dedicated to purchasing an asset (a home). Using it to buy a consumable (a car) is backwards.

I love my car. I take it out for pleasure rides all the time. I feel about 2,000% safer driving it than I did the 30yro Benz. But buying it didn’t compromise any of my financial goals. I didn’t have to wipe out my house savings to buy it, and it’s pricetag didn’t come up to half of my retirement savings, let alone that of mine & my fiance’s combined.

I’d definitely wait a year. Or 2 or 3 or 5. Drive it until it dies, or at least until your retirement savings and house fund grossly outpace the cost of a vehicle.

Thanks for this Bridget! These are all things I know, and that logically make sense, but you know how the cloud of “wanting” something can fog over all of those rational arguments.

I’m definitely going to wait a few years. I plan on cutting my travel fund next year (I’m putting away about $7,500 this year for travel) and using the difference to start a car fund. A few years of that and I should be set – without having to dip into the house fund.

Susie

I totally understand where you’re coming from with the manual situation. My husband and I have a 2008 Tacoma (that we’ve had since ’08) I get really nervous driving it in the winter time. Mostly when I have to stop uphill (same fear of rolling back into someone from the icy roads).. But I love it and we’ll drive it until it dies.
This summer my wants almost got the best of me.. I seriously considered taking out a loan for a Vintage (apple green) VW Beetle. A car I’ve wanted for as long as I could remember. Thankfully, my husband was the voice of reason and made me realize it probably wasn’t the best idea considering where we live it’s winter most of the year (6-7 months) and we’d have to store for those months (we don’t have a garage) so that would be an additional expense. On top of the fact that I would have to take out a loan because I didn’t have the money saved. It was close but thank goodness for rational thinking.. haha.

Man, I want a new car too! Ours is starting to fall apart but still functional and safe. It’s one thing that my husband and I mention all the time but don’t act on. It definitely sucks spending money on car repairs. Sorry to hear about that but good thing there’s an EF to pull from.

I’m very happy to have an EF for this type of situation! Usually, I keep $400 or so in my car maintenance fund, but these repairs went beyond that, so the EF was a life saver. I love that I can just pay for these repairs in cash and not have to worry about credit cards.

AB

I have an Impreza hatchback that’s pushing 10 and I love it. It’s my first adult car (I managed with public transit and bikes for a long, long time), bought 4 years ago with low KMs. Existing aesthetic damage priced it well below the comparable mint-condition value. It’s AWD, meaning we get through snowy winter rural driving with all season tires safely. The AWD makes for poorer fuel economy than I’d like. – I’m surprised this hasn’t come up yet. I’d suggest comparing your dream cars’ fuel economy here, if you haven’t already! http://oee.nrcan.gc.ca/fcr-rcf/public/index-e.cfm

I actually looked at the Impreza first! It’s about the same size as our golf but has AWD which is nice. If I was going to upgrade today, the Impreza would be my #1 choice. The only reason I passed the Impreza over is because of this reasoning:

1) I’m going to try and keep the golf at least the next two years, which means I’ll probably be 28 by the time I finally get a new-to-me car.
2) By that time, if I’m going to have a kid, it’ll be within the new car’s lifespan, and the Impreza might be a little small for kid + dog carting.

I’m not sure about that though. I’d have to test drive one to really know. The Impreza is definitely on the short list. It’s more affordable than the Outback and I love its compact size.

Also, I always look up fuel economy ratings for whatever car I’m considering! It’s so cool that someone else does that too! Upgrading to a VW Tiguan would add about $500/year to our fuel costs. Not ideal, but it’ll just be most incentive to continue using our bicycles as our primary form of transportation.

AB

Thanks for the reply! My Impreza is the older model, so it probably has more storage capacity than the newer, more compact model (although the latter has better mileage – it might be a smaller engine, I can’t remember). I can’t imagine needing anything, bigger, ever. Not for hauling around tiny humans and a dog (mind you he’s not a big breed), or 5 adults across four provinces (that trip was a little squishy, I’ll admit, but totally doable), or adults lugging sports stuff like hockey bags and golf clubs or bikes. We have the ability to attach a cargo carrier on the roof but honestly have never needed to.
Full disclosure if it wasn’t already clear: I’m solidly of the SUVs/crossovers-are-totally-excessive mindframe, haha. I think they are a slippery slope where wants meld into needs because we think bigger is better and our lifestyle requires it. And I think you and I find common ground here! 🙂

I’m still driving my first “adult” car, and I definitely want it to last forever. I think even when it’s desperately necessary, I’ll try to hold off as long as possible.
But… I just moved to New Jersey, and I’m being told my little Corolla won’t make it in the snow. Ugh. I guess we’ll see.

Get Winter tires. They’re a bitch to store, but they really do make a difference. My VW Golf is a tank in the snow with its winter tires considering it’s front wheel drive and has really low clearance. The situation I referred to above with my husband getting into a sticky situation in a snow storm involved the worst storm of the year and unplowed roads. That’s the first time it hasn’t been able to handle the road conditions!

Erin

I’m still on my first car that I bought in 2010 after I graduated university. It was a “new to me car” with only 23000 km on it for $8000. I paid it off in less than 3 years so it’s been great not having a car payment! It still runs great and I’ve brought the mileage to 150 000 km but I hope to keep it until I plan to have kids in 2-3 yrs (it’s a 2 door with no power windows or AC). I’ve definitely been tempted to trade in my car for a new one especially sitting bumper to bumper on the highway with no AC in July! But my car drives great with no big repairs coming up so I really want to squeeze a few more years out.

My husband’s first car had no AC, so I understand! When I totalled that car and had to buy the Golf, it was a choice been manual and AC and automatic and no AC. We chose the AC! I’m hoping to keep my Golf until kid-time (if that time ever comes), it’s just a matter of restraining my new car lust until then!

Flashaway

I just bought a car in last may, so I can totally understand your situation. I’ve had for 8 years a Toyota Yaris, manual and no AC. I didn’t put a single dime on reparation on this car, even if it had some mileage on it when I bought it (except normal maintenance).

I wanted to drive this car until it dies but I got a new job in march. I now have to drive 2h+ per day, in rural routes and then city traffic (in my previous job it was 1h max a day). There was NO way that I was going to drive in traffic without AC and with a manual transmission. I live in Quebec and driving can be really dangerous (I’ve seen some of your pics about driving in winter, I can totaly relate 😉 ) and with a little Yaris, I had to be very careful.

I could have kept my car, but I truly wanted a new one. I didn’t had any savings for that, I just finished saving 7.5k for a house cashdown and I didn’t want to use it for the car (we may buy a house in near future anytime now, depending on the next contract my boyfriend will get). So I bought a 2012 Corolla, automatic with AC. I pay around 215$/month for that car, so that’s not so bad. I hate having that debt, so I’m paying about 400$ more per month to get rid of that loan (while trying to increase my house cashdown). Do I regret my choice? Not at all. I’m not dying in my car thanks to AC and I feel safer driving my Corolla. I still miss driving manual, but not in the city ;).

I’ll join the chorus for the “carless” (does this word even exist??)
We don’t own a car, and we use Car2Go and Communauto when we absolutely need to go somewhere that public transport is not enough for us, or we take a taxi. When we travel we rent.
Our transportation costs are not even close to what would cost us to own a car, and we do not necessarily deprive our family of doing nice things because we don’t have a car — we are finding alternatives (not the cheap alternatives to nice things, but rather cheaper alternatives to get there).
“I wish we could go car free” — I’ve seen you saying this more than twice now. Why not make this wish come true?
If you cannot go car free, try to imagine what if you could?
And if you could, how much would you save?
If we’d consider only the financial side of having a car, we’d never ever buy another car in this world, but we all fall for the emotional side when things like these are in game 🙁

We’re sticking to one car for now. The only thing we really need it for is my husband’s commute. He works odds hours when public transportation doesn’t run. Other than that, we could get away with renting a car for trips home to New Brunswick, it would certainly be cheaper. But the commuting thing, that’s tough. It’s a 15km one-way trip. Not crazy, but not doable by bike in the winter, in a snow storm. If he gets a job with better hours that is closer to the city centre, I’d consider going completely car free. 🙂

Indeed, these are some serious limitations.
As a side note, have you ever wrote about how you manage finances as a couple? I am always curious about this topic but it’s always too much sensitive for some people…

A bit late to the discussion here… but I am still driving my first “adult” car… It is an older Impreza hatchback and I love it. I bought it used (but very “lightly” used) and it has served me well for almost 10 years. A couple years ago I was very tempted to upgrade to a new Outback (I have a thing for Subarus), but I have since decided that I am going to drive this little Impreza until it dies… Growing up, one of my best friends’ dad had a Subaru that was pretty old, but it drove a bunch of us to soccer practice every week without any problems…